Growth Street officially went live roughly a fortnight ago, applying the marketplace lending model to a small business overdraft offering.
Growth Street provides access to flexible overdrafts of up to £150k for small businesses. Those overdrafts are funded by a select community of investors, in not dissimilar fashion to the consumer lending outfit Lendable. These investors must be either: a High Net Worth individual (with either £100k+ annual income or £250k+ in net assets), a Sophisticated Investor or a company or institution. CEO James Sherwin-Smith indicated to me that this last band of potential investors may well come to include former Growth Street business borrowers.
We now have a little more detail about the structure and management of the nascent platform. Growth Street has been incubated by Arts Alliance Ventures – the venture capital firm that stands behind such brands as Interactive Investor, lastminute.com. LoveFilm, Shazam and Graze.com.
In tandem with its launch, Growth Street has revealed the successful closing of a £5m round – comprised of both equity and lending capital (an exact breakdown has not been disclosed). The fundraise was led by Arts Alliance, whilst also attracting participation from quite the lineup of prominent individual investors. These included investment bankers Christiaen van Lanschot (VOC Capital Management) and Paolo Cuniberti (formerly of J.P. Morgan), lawyers Peter Hockless (Debevoise & Plimpton) and Anthony McWhirter (Debevoise & Plimpton), David Giampaolo of Pi Capital, and former FCA regulator Victoria Raffé.
The current CRO, Greg Carter, led the incubation of Growth Street within Arts Alliance. He previously worked in the ventures team at Betfair. CEO James Sherwin-Smith joined the platform in May after spending time at MasterCard Advisors and Oliver Wyman.
Thomas Høegh, Co-Founder of Growth Street and CEO at Arts Alliance Ventures, outlined the platform's grand designs:
“With LoveFilm we went after Blockbuster and won. This time around we are going to redefine the ‘service’ element of financial services and give the high street banks a run for their money.”